The U.S. Department of Justice (DOJ) has filed a federal complaint against several of the largest Medicare Advantage insurers, alleging that they paid kickbacks to brokers in an effort to increase enrollments. The complaint names Aetna (a CVS Health subsidiary), Elevance Health, and Humana, claiming that the insurers collectively paid hundreds of millions of dollars to brokers from 2016 through at least 2021.
These payments were allegedly used to steer Medicare beneficiaries into the insurers’ plans, and in some cases, to discourage the enrollment of individuals with disabilities. According to the Wall Street Journal, the DOJ asserts that the payments were not presented transparently and were instead framed as reimbursements for marketing or administrative services.
Brokers Named in the Suit
The brokers identified in the complaint include:
- eHealth
- GoHealth
- SelectQuote
The DOJ claims that these brokers were influenced to prioritize higher-paying plans over plan suitability or quality, potentially compromising their role as impartial advisors to consumers.
Key Points in the DOJ Complaint
- From 2017 to 2021, Elevance allegedly paid $230 million to GoHealth to direct enrollees to its plans.
- Aetna and Humana are accused of taking steps to limit the enrollment of individuals with disabilities, whom they considered more expensive to insure.
- The complaint includes internal communications in which sales executives from Aetna and Humana discuss efforts to reduce the share of disabled enrollees, describing such tactics as a “compliance risk” but still acting on them.
- In one cited example, an Aetna executive expressed frustration over a broker’s “extreme U65 mix,” referencing enrollees under age 65 who typically qualify for Medicare through disability.
Responses from the Parties Involved
The companies named in the complaint have issued statements in response to the allegations:
- CVS Health (Aetna) and Humana both stated that they disagree with the allegations and intend to defend themselves.
- Elevance Health said it is confident its broker payment practices comply with federal rules.
- eHealth described the DOJ’s claims as meritless.
- GoHealth denied wrongdoing and stated that the allegations against it include misrepresentations.
- SelectQuote called the claims baseless and plans to vigorously defend itself.
Context and Industry Implications
Medicare Advantage, which allows private insurers to manage benefits for Medicare beneficiaries, has become a significant part of the U.S. healthcare system. Over half of all Medicare enrollees are now covered under these private plans.
The DOJ’s legal action follows increased scrutiny of Medicare Advantage practices. This includes an earlier Wall Street Journal investigation and questions raised during the confirmation hearing of Mehmet Oz, the new director of the federal Medicare agency, who pledged stricter oversight of industry conduct.
The DOJ is also reportedly investigating UnitedHealth Group — another major Medicare Advantage insurer — regarding how diagnoses that affect federal payments are recorded, although UnitedHealth has denied knowledge of such an investigation.
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